ECONOMICSfor a BETTER

WORLDSelected Readings

Suryati IshakEDITOR

Universiti Putra Malaysia Press43400 UPM SerdangSelangor Darul Ehsan

Tel: 03-89468851 / 89468854Fax: 03-89416172Web: http://penerbit.upm.edu.myEmail: penerbit@upm.edu.my

This book is a compilation of studies in different fields of economics that engages with empirical research from the Department of Economics, Faculty of Economics and Management, Universiti Putra Malaysia. In this book, readers will discover five chapters of issues in economics, i.e., foreign direct investment, gender disparities, firm-level export intensity, monetary policies, and Internet banking. This book is suitable for readers in understanding economic issues, and it can also serve as a reference, as it is packed with knowledge of current issues in economics.

Universiti Putra Malaysia PressSerdang • 2018

© Universiti Putra Malaysia Press 2018First Print 2018

All right reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form, or by any means, electronic, mechanical, photocopying, recording or otherwise, without prior permission of the copyright owner.

UPM Press is a member of the Malaysian Book Publishers Association (MABOPA) and a member of Malaysian Scholarly Publishing Council (MAPIM).

Perpustakaan Negara Malaysia Cataloguing-in-Publication Data

Economics for a Better World : Selected Readings/ SURYATI ISHAKMode of access: InternetOnline resourceISBN 978-967-344-844-91. Economics--Sociological aspects. 2. Economics.3. Government publications--Malaysia. I. Suryati Ishak.082.04

URL://www.econ.upm.edu.my/penerbitan

Typesetting: Ku Ida Mastura Ku BaharomCover Design: Nurul Shafiza BorhanuddinType Face : Times New Roman PSFont Size: 11/14.5 pt

Contents

List of Figures and Tables vii

Preface ix

CHAPTER 1 FDI and Growth: The Role of InstitutionsTun Yin-Li, W.N.W. Azman-Saini, Law Siong

Hook and Azman Hassan

1

CHAPTER 2 Factors Influencing Gender Disparity in Labour Force Participation in Malaysia

Rusmawati Said, Amna-A’liah, Chen-Chen Yong

and Asmaddy Haris

20

CHAPTER 3 The Determinants of the Firm-Level Export Intensity in Malaysian Manufacturing SMEs

Nur Aziha Mansor and Normaz Wana Ismail

37

CHAPTER 4 The Effects of Monetary Policy on Malaysian Stock Market: The Overall and Sectoral Responses

Lim Pei Xiang and Lee Chin

62

CHAPTER 5 Customer Satisfaction and Service Quality of Internet Banking in Malaysia

Anitha Rosland

78

Index 93

List of Figures

Figure 1.1 FDI versus real GDP 9

Figure 1.2 Institution versus real GDP 9

Figure 1.3 Residual versus leverage for real GDP 13

Figure 2.1 Malaysian labour force participation rates over the life cycle, 2010

22

List of Tables

Table 1.1 Descriptive statistics 7

Table 1.2 Correlation matrix 8

Table 1.3 The growth effect of FDI and institution 10

Table 1.4 Interaction specification between FDI and institution

11

Table 1.5 Interaction specification (excluding outliers) 14

Table 2.1 Labour force participation rate by gender, ASEAN, 2010

21

Table 2.2 Estimated probability of male and female labour force participation

28

Table 2.3 Decomposition of gender differences in participation rate (in %)

31

Table 2.4 Variables included in logit regression analysis for male-female

36

Table 3.1 Descriptive statistics 45

Table 3.2 Determinant of firm-specific characteristics on export intensity

47

Table 3.3 Determinant of manufacturing subsector characteristics on export intensity

48

Table 3.4 sensitivity analysis (monopolistic competition) 51

Table 3.5 Sensitivity analysis (oligopoly) 53

Table 3.6 List of manufacturing subsectors 60

Table 3.7 Correlation matrix of Malaysian manufacturing SMEs

61

Table 4.1 Augmented Dickey Fuller Unit Root 69

Table 4.2 Co-integration test based on Engle-Granger Two Step Approach

70

Table 4.3 Cointegrating regression using OLS 71

Table 4.4 Error-Correction Model (ECM) 73

Table 5.1 Service quality and customer satisfaction on internet banking

82

Table 5.2 Regression analysis 84

Preface

This book is a compilation of studies in different fields of economics that engages with empirical research from the Department of Economics, Faculty of Economics and Management, Universiti Putra Malaysia. In this book, readers will discover five chapters of issues in economics, i.e., foreign direct investment, gender disparities, firm-level export intensity, monetary policies, and Internet banking. This book is suitable for readers in understanding economic issues, and it can also serve as a reference, as it is packed with knowledge of current issues in economics.

Grateful acknowledgment is made here to all the authors and reviewers of this book. This book would not have reached its present form without their support and invaluable help. A special note of thanks to the head of the department, Associate Professor Dr. Wan Azman Saini Wan Ngah, for his assistance, and special thanks to Nur Syazwani Mazlan for her thoughts.

Suryati IshakSerdang, 2018